EUROPEAN CAPITAL MARKETS AND INVESTOR INTENTIONS 2014 Dr Peter Damesick Chairman EMEA Research 12 March 2014

Global Commercial real estate Investment $ billion Change 2013 vs 2012 Americas +16.5% EMEA +34.3% Asia Pacific +28.0% Source: CBRE Research, RCA; * All commercial real estate and hotels Represent as graph above

Cross-regional global capital boosts European real estate investment € billion Source: CBRE Research Represent graph as above- perhaps the bars appear first and then the line afterwards

Global real estate investment in Europe Market distribution, % total purchases Source: CBRE Research All of the 2012 information appears first and then the 2013 information appears.

Cross-regional global capital Flows in Europe 2013 by Market € billion Source: CBRE Research Represent graph as above

Commercial real estate Investment In UK £53 billion transacted in 2013 – £21 billion in just Q4 £ billion Source: Property Data, CBRE Research The only thing that we would like to happen here is that we animate the last bar – Q3 2013

Commercial Property Investment in Euro Periphery Ireland, Spain, Portugal, Italy € million Source: CBRE Research Represent graph as above – can we add a new slide after this one that states: Investor Intentions Survey Results 2014

Europe’s fastest growing investment markets in 2013 Cities with biggest relative increases in sales 2013 vs 2012 Source: CBRE Research

Investor Intentions Survey Results 2014

Survey respondents by type of organisation Source: CBRE European Investor Intentions Survey 2014

Which global region is most preferred for investment? Source: CBRE European Investor Intentions Survey 2014 Show 2013 first and then 2014

Investing outside Europe in 2014? Source: CBRE European Investor Intentions Survey 2014 For this can we use an animated pie chart starting with – yes less than 2013’, then Yes, same amount as in 2013, then Yes, more than in 2013, and finally No appearing. Yes less than 2013 – 5% Yes, same amount as in 2013 – 11.2% Yes, more than in 2013 – 19.6% No – 64.2%

Investment outside Europe on 2014: Which Regions? Percentage of respondents who will invest outside Europe 78% 52% 24% 21% 17% 5% 4% North America Developed Asia Emerging Asia Pacific South America Africa Middle East * Respondents could choose more than one region Source: CBRE European Investor Intentions Survey 2014 Perhaps we could use a heat map here – starting with the largest.

Asia pacific investors: where will they invest globally in 2014? Percentage of respondents who will invest outside Asia Pacific 68% Western Europe North America 57% Central and Eastern Europe 23% South America 8% Africa 2% Middle East 2% * Respondents could choose more than one region Source: CBRE Asia Pacific Investor Intentions Survey 2014 Perhaps we could use a heat map here – starting with the largest.

Most attractive country in Europe for investment purchases Source: CBRE European Investor Intentions Survey 2014 All of 2013 information appearing and then 2014 information follows.

Most attractive city for investment purchases Dublin Rise in attractiveness of Spanish cities Source: CBRE European Investor Intentions Survey 2014 All of 2013 information appearing and then 2014 information follows. The key point here is that Madrid and Barcelona are now extremely attractive – perhaps we could circle? Also highlight Munich and Hamburg.

Most preferred sector for investment purchases Stronger preference Source: CBRE European Investor Intentions Survey 2014 All of 2013 information appearing and then 2014 information follows. Again, circling the decline in Logistics, Shopping centres,Light industrial and retail warehouses. (Eleanor – Light industrial doesn’t decrease)

Top 3 ‘most attractive’ for purchases in 2014 Countries Cities Sectors 1. UK 29% 2. Germany 21% 3. Spain 19% 1. London 30% 2. Madrid 14% 3. Berlin 9% 1. Offices 39% 2. Logistics 16% 3. Shopping centres 11% Source: CBRE European Investor Intentions Survey 2014

Most preferred asset type for purchases 2013 2014 Source: CBRE European Investor Intentions Survey 2014 All of 2013 information appearing and then 2014 information follows.

Risk appetite for secondary assets in 2014 compared with last year 49% Source: CBRE European Investor Intentions Survey 2014 Spelling of ‘Much Lower ‘ is incorrect – can you please amend. Represent graph as above

Most preferred asset type for purchases Percent of investors by global region, 2014 Source: CBRE Investor Intentions Survey 2014

Investment and interest in alternative sectors Invested Actively interested Source: CBRE European Investor Intentions Survey 2014 Split the screen in two – on one side show the actively interested details and on the other what has been “invested” in already – start with Invested on the left had side Actively interested: Student living – 12% Retirement living – 10% Healthcare – 9% Infrastructure – 9% Self Storage – 5% Leisure – 3% Automotive /car parks – 3% INVESTED IN: Leisure – 27% Student living – 25% Retirement living – 12% Healthcare – 17% Automotive /car parks – 17% Infrastructure – 14% Self Storage – 7%

Expected purchasing activity this year compared with last year 67% of respondents said purchasing activity would be higher in 2014 Source: CBRE European Investor Intentions Survey 2014 Represent as is – perhaps adding a circle to the first 3 bars for 2013 and 2014 indicating that a total of 67% purchasing activity will be higher

What is the biggest obstacle to acquiring assets in Europe? 82% of investors cited these 3 obstacles Source: CBRE European Investor Intentions Survey 2014

What is greatest threat to European property markets? 62% of investors pick one of these threats Source: CBRE European Investor Intentions Survey 2014 Represent as is

What effect would UK exit from EU have on Uk’s attractiveness for investment? Source: CBRE European Investor intentions Survey 2014 Represent as graph above – again perhaps circling the last 2

Investor intentions Key themes 2014 More confidence in Europe Resurgent interest in Spain Investors moving up risk curve Most attractive asset types outside prime/core Greater appetite for secondary Higher purchasing activity in 2014 Markets more crowded and competitive Perception of over-pricing as threat

Panel discussion lead by Jonathan Hull Managing Director, EMEA Chris Brett Head of International Capital Markets, UK Marc Giuffrida Executive Director, Singapore Peter Schreppel CEO, Germany Adolfo Ramírez-Escudero President, Spain